Apple first quarter revenue dips but services total hits record high

Apple first quarter revenue dips but services total hits record high

Apple reported a total of $84.3 billion in revenue for the first quarter of 2019, representing a 5% dip year-on-year. 

However, quarterly earnings per diluted share were up 7.5% at $4.18 and revenue from services – including Apple Music – scaled an all-time high of $10.9bn, an increase of 19%. The gross margin in Apple’s services was 62.8%. International sales accounted for 62% of Q1 revenue.

Revenue from Mac (up 9%) and wearables, home and accessories (up 33%) also reached all-time highs.

During the company’s first earning call of the year, it was confirmed that Apple Music had passed 50 million subscribers. Spotify last reported 83m subscribers and has forecast up to 96m for its next earnings results, due on February 6.

Apple CEO Tim Cook said: “While it was disappointing to miss our revenue guidance, we manage Apple for the long term, and this quarter’s results demonstrate that the underlying strength of our business runs deep and wide.

“Our active installed base of devices reached an all-time high of 1.4bn in the first quarter, growing in each of our geographic segments. That’s a great testament to the satisfaction and loyalty of our customers, and it’s driving our Services business to new records thanks to our large and fast-growing ecosystem.”

Luca Maestri, Apple’s CFO, added: “We generated very strong operating cash flow of $26.7 billion during the December quarter and set an all-time EPS record of $4.18. We returned over $13 billion to our investors during the quarter through dividends and share repurchases. Our net cash balance was $130 billion at the end of the quarter, and we continue to target a net cash neutral position over time.”

The company forecast revenue between $55 billion and $59 billion for the next quarter.

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